The SEs also look at the text placed next to and near an image to try and glean information as to what the image is about - as well as the ALT ATTRIBUTES that are within the image tag.

That method only works if the images are in stream with text and/or have captions associated with them (and if the SE can understand that the text is a caption). I am prestty sure that is how Google works. Add in the link text to the image and you can get a high accuracy of the image.

YAMV (Your Accuracy May Vary) based upon how good the caption and link text is of course!

I can tell you this much: Yahoo is very interested in the alt attribute.

I was checking the rankings on one of my sites yesterday, and when I ran one of the phrases through, I noticed that two images from my site were coming up in the little top four "Image Results" preview on the SERP, so I clicked through to see the full image results. Of the top 20, my site had numbers 2, 4, 5, 7, 10, and 17. Each of the images has the two-word phrase as the first two words of the alt attribute and the only other place on the pages where any part of the phrase appears is in the title tag, where a variation on the second word appears. The keywords are also not in the links to the pages on which these images appear, although they are all over the site. One other thing, and I have no way of knowing based on this whether this makes a difference: all of these images are linked, but they're linked to copies of themselves (some of them to the exact same file, some to a larger version) outside of a page, where they obviously have no place for the keywords to appear, except in the file name, where they are not present.

The home page of the site comes up at #15 for the phrase in the normal results, by the way.

And in case you're interested, this is very different from the results at Google: the site's home page is #5 for the phrase, and on the image search, one picture from the site comes up, at #7. That image does not have the phrase in its alt attribute, but the phrase is the first two words of the page's title tag.

This post on how to optimize images to rank is now about 3 years old and I'm wondering what may have changed in the past few years.

I'm summarizing what I believe to be the most important elements in (hopefully) getting images to rank:

File names should include the keyword phrase(s) the page is optimized forInclude keywords in the Alt Attributes tagWhere possible include descriptive text or captions around the imageAllow engines to index your /images directoryImages should be optimized for optimal download times

In Google Search's main index I rarely see images appearing as a search result; so I'm interested in understanding if going through a large site to make these changes is worth the effort. Of course we wouldn't do this for all images - but selected images of such items as illustrations and products.